The Chambers of Commerce of Ireland report published last week, EU/US Air Transport Agreement — Potential Impact on Ireland, is framed in this context. It reflects a growing recognition of two things. First, change is inevitable. Second, the debate is no longer about protecting what we have but identifying opportunities and how to maximise the benefits for Ireland.
A third of US exports leave the country by aircraft, illustrating opportunities for Ireland as an open trading economy that is firmly “plugged into” the American economy. The change in aviation regulation offers opportunities which, if embraced, can further support our current pace of economic development.
The OAA will create the largest single international aviation market with a population of more than 700m. It will build on the EU liberalisation of the airline industry in 1992-1993, which had a tremendously positive impact on this country.
We must ensure that this agreement has a similarly positive impact. On its own, an OAA will provide a limited boost to economic development.
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To reap most rewards, it must be combined with other policies, infrastructure investments and incentives.
Under the OAA, carriers will be able to fly from anywhere in the EU to any US location. Irish airports must position themselves, review their pricing structures and diversify their service offering to survive.
Infrastructural links between the east and west of Ireland must be improved so that existing and new industry in the west will not be tempted to abandon or discount a location there. A motorway link between Galway and Shannon will be crucial in improving access and maintaining the viability of Shannon airport.
Its dual gateway status can only be maintained on a transitional basis. Shannon has started to prepare by extending its route network but it needs to do more. The airport will be able to sustain links to America if its cost base is right and its links to Europe are attractive.
The Essential Air Services Programme (this provides air services, to pre-specified standards, for regions regarded as remote and/or underdeveloped and where it would not be commercially viable for air carriers to provide such services) reinforces Dublin’s dominance in terms of airport services at the expense of Shannon and, to a lesser extent, Cork. A public service obligation could be introduced on routes between Shannon and/or Cork and certain US destinations as a transitional arrangement. It could be funded by abolishing current support for intra-Ireland flights on routes yielding more than 30,000 seat sales per year.
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The timetable for change will not be determined by Ireland but by the EU/US negotiations and we must recognise that the clock has been ticking for quite some time. We must act now to secure our position in the global trading environment and build on it for the benefit of our economy and society.
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John Dunne
chief executive,
Chambers of Commerce of Ireland